Shoe units divided over GST

Vijay C Roy

Tribune News Service

Chandigarh, June 5

The leather industry seems to be divided over GST rates on footwear. While some footwear makers expressed their disappointment over an overall increase to a higher slab of 18% on leather shoes, others welcomed the move stating that the impact may not be much. 

Recently, the GST Council meeting, chaired by Finance Minister Arun Jaitley, categorised footwear into two tax slabs, priced below Rs 500 will be taxed at 5%, while others will be taxed at 18%.

Woodland Worldwide MD Harkirat Singh said, “It has come to us as a surprise. GST rates will affect the footwear industry as it is such a big game changer. We cannot judge the impact of GST overnight.” He, however, said corporates who were into manufacturing as well as retailing of lifestyle products would be hit. 

Industrialists said since most leather shoes were being priced above Rs 1,000 so tax slab of 18 per cent would not have much impact and would not lead to increase in price either. 

Drish Shoes vice-president (operations) Ajay Sharma said: “With GST, the Industry will have to shell out 18 per cent instead of current 23%, including all taxes, on the footwear priced above Rs 1,500. Since there are only two brackets, footwear makers paying in Rs 500-Rs 1,000 range will lose to some extent. Overall, the impact may not be much.”